Gas problems

[Crispin's Crispian]

I just thought I'd post some interesting news that directly affects my industry, and indirectly affects almost every other industry in the world.

The three major small parcel carriers (UPS, DHL, and FedEx) announced their fuel surcharges for May, and they are higher than we've ever seen.

UPS and FedEx will now charge you a 25% for air services, and 7.75% on ground. DHL is 27% for air and 7.8% for ground. So if you wanted to ship something for Grandma's birthday on Friday, you need to use an air service. If you pay $20 in shipping charges alone, you will pay an additional $5 for the fuel! Last May, air was a meager 11% and ground was 4%.


Now think about all the stores you shop at, and how they all get their goods. They're also paying 25% for air services, which you can bet is being passed on to you in higher prices. 7.75% for ground is no bargain either.

[Sei'taer]

Is it only up there where you are that Sams and Costco are rationing rice? Seems like I heard it was Oregon.

Construction costs here have gone out of sight. Last year for a ton of asphalt it was about $150, this year its $375 to $400 a ton. Concrete went from $55 a cubic yard to $120 a cubic yard plus a $10 surcharge for fuel to deliver and they are talking about going to a $20 surcharge. Add that in to $4.29 for a gallon of diesel on all the equipment that runs daily and you are getting into some serious costs, then you add in the slump in the housing market and very little building going on and contractors are hurting bad. They are taking jobs just to stay open and are not taking any profit or taking very little profit.
We opened bids for a capital improvement project yesterday and the low bid was $89,000 and we estimated the cost to be $177,000. The contractor said he was using the job simply to make payroll. All seven bidders were under $100,000 though, so that gives you an idea of how hard it is. Highest bid was only $6200 away from the lowest bid and that is extremely rare.

[Crispin's Crispian]

Is it only up there where you are that Sams and Costco are rationing rice? Seems like I heard it was Oregon.
I haven't heard about that at all. I haven't bought rice at Costco in a while, so I don't know what they're doing.

What is causing the jump in raw materials pricing? Doubling the cost in a year is crazy!

[Sei'taer]

I could say, but then it would turn into an environmental type thread and I want to keep it simple.

As for the rice. From what I understand, we in the US have plenty, but in other countries the price has skyrockted because of shortages. So, families that live here are buying it cheap and sending back to their home countries. That is causing shortage scares here, so some companies have started rationing. Thats my understanding and I may be totally wrong. It started with Costco, but I heard today that Wal-mart and Sams Club were planning on doing the same thing. They said they were limiting buyers to 30 lbs every 2 weeks...I think thats right.

[Zaela Sedai]

I would just like to say my last trip to the gas station was $49.03....and I know the next will be $50....and then I will drive my car through the storefront...

no...I won't...I'll mutter all the way back to my car


I only have a 13 gallon tank.

What I'm surprised about is that CT Transit has not upped the bus pass price yet. I get it discounted through my company at $63 a month. And it takes about 1 tank of gas to get to the bus stop every month.

So like 113 bucks a month to get to work.

Even if it goes up it still saves me...hrmmmmm 5 tanks of gas would be say $250 plus $95 for the garage so 345 - 113 = $232 a month. So at least 200 bucks a month still even if they raised it 30 bucks....My only point is that I'm surprised they haven't yet :lol

[Gilshalos Sedai]

I'm not even going to discuss what our gas tank cost to fill up on Sunday. Needless to say, we got it filled on the way back from church on the cheap side of town and still paid $65 for a @20gal tank.

[Sei'taer]

It's around $3.60 a gallon here, and about $4.15 for diesel. Cost me $42.03 to fill my tank on the small car. I only put $20 in the big one. I really want to go into a huge rant here, but I'll save it.

[Ishara]

Whiners! We drove to Buffalo on Saturday to fill up because it was about $25 cheaper to fill up my mum's tank States side than it was in Canada. No idea how big her tank is though - it's a Golf fwiw.

[GonzoTheGreat]

Wow! Gas is really cheap for you. You're lucky with that, you know.

[Ivhon]

Wow! Gas is really cheap for you. You're lucky with that, you know.

Yes, Gonzo, we know. We are just adjusting to the fact that a gallon of gas now costs more than a gallon of water... hard times, hard times.

[Crispin's Crispian]

Yeah, U.S. gas at the pump is cheap compared to Canada and Europe, but to me that's only a small issue. It's salient because we see it so clearly (gas station signs and whatnot), but the cost of fuel is driving up the cost of everything else. Even beer is way more expensive than it was last year. I can't blame it all on fuel, but I will try.

[Davian93]

Yeah, U.S. gas at the pump is cheap compared to Canada and Europe, but to me that's only a small issue. It's salient because we see it so clearly (gas station signs and whatnot), but the cost of fuel is driving up the cost of everything else. Even beer is way more expensive than it was last year. I can't blame it all on fuel, but I will try.


Beer is also more expensive because less wheat and hops were planted last year because farmers concentrated on Corn for ethanol...what a joke.

[Ishara]

Well that's a reason to come to Canada then! Cheaper and better beer!

[Terez]

When I was a senior in high school it would have cost me $10 to fill my current tank. When I bought the car (10 years later), it cost about $14-16. Now (2.5 years later) it costs $36. And I'm not making any more money...

[jason wolfbrother]

when I first started driving the car I'm driving now I could take $20 and fill it up with enough to buy a 20 oz MD as well. now I can't even get from under a 1/4 to over 1/2 a tank with that $20. and forget about buying the extra MD :(

[Terez]

I can just see a bunch of jackasses somewhere saying, "Jeez, I wish we'd have known years ago that they'd pay whatever we charge for it..."

[Davian93]

Gas is $3.89 a gallon on my side of the border and 1.34$ a liter on the scary French speaking side of the border.

[Sei'taer]

Stein: Stop Whining And Blaming Oil Cos.
Worried About Gas Prices? Ben Stein Says Don’t Look To Government Or OPEC To Help

Ben Stein says nothing the government does can stop the rise in oil prices. But instead of blaming oil companies, he says you should just drive less. And there's always the bus. (AP)





(CBS) Like many of the rest of us this weekend, Contributor Ben Stein has his eye on the gas pump:

--------------------------------------------------------------------------------
Topic A on everyone's mind these days is the amazing price rise of oil and gasoline by historical standards.

Herewith, some good news and some bad news.

First, the bad news: Nothing - and I mean nothing - the U.S. government does can stop the rise in the price of oil in the short run.

Stopping buys for the emergency stockpile will have no effect at all. These purchases are less than one-tenth of one percent of daily worldwide demand.

Cancelling the purchases is precisely the same as not paying life insurance premiums when you're worried about money. It is nonsense.

Laws taxing oil speculators will do nothing. Most of the speculation is going on outside of U.S. jurisdiction anyway.

And if we stopped having a free market in oil, it would go back to being an OPEC-fixed price. Do you think they would be kind to us? If so, why?

Taxing the oil companies is the worst possible idea. We should be giving them tax incentives to pump more oil, not punishing them for pumping oil … and their profits have absolutely zero to do with setting the price of gasoline at the pump.

Zero.

Finally, the worst news: Oil has been going up a lot faster than gasoline. That means gasoline might possibly have far more upward movement in price. Be prepared.

Now for the good news: Oil is a commodity. Usually commodity prices go in cycles. That means they usually (not always) go down after they have gone up sharply. It could and probably will happen this time, too.

In other words, it sure looks like a bubble, although a bubble that might last a long time.

But here's even better news: You can get a more fuel efficient car; car dealers are very much in a mood to deal, and they will make it easier than you can even imagine to get a fuel saving car or truck.

And, you can drive less. Once in a while take mass transit. You have it in your power to save money on oil.

If everyone in the U.S. does this, it will affect the world demand for oil meaningfully, and will eventually move price downwards.

Or, we can just whine and blame the oil companies, - which will get us exactly nowhere.


© MMVIII, CBS Interactive, Inc. All Rights Reserved.

[Davian93]

We should invade Canada...they have lots of oil...and friendly people. Besides we could use some new States...

[Ishara]

I <3 Ben Stein, and his damn show. I miss that show!

Why not just defect Davian, you know you want to! Skip the messy invasion and just ask nicely and we'll let you in!

[Gandelail]

It's around $3.60 a gallon here, and about $4.15 for diesel.

Where I'm at, I pay $3.78 or more per gallon, and diesel is $4.85 or more. Watch out, it might just be lurking around the corner waiting to get you again too !

[Sei'taer]

That was post was made a few weeks ago (Heroes have privileges, 'specially hillbilly heroes). Today gas is $3.86 and Diesel is $4.55. Thank god I didn't let my buddy talk me into that diesel burner.

[irerancincpkc]

Gas is 3.95 here... not fun.

Davian, if Bush had more time in office, I'm sure invading Canada would be on his to do list.

[Sei'taer]

Meh, I could fix the gas problem in a week...two tops. Everyone would hate me, but its not like thats ever been an issue.

[Sarevok]

Uhm... WTF!!

since when is Diesel more expensive than ordinary fuel???

[irerancincpkc]

Uhm... WTF!!

since when is Diesel more expensive than ordinary fuel???
It isn't like that everywhere else?

[Sei'taer]

Uhm... WTF!!

since when is Diesel more expensive than ordinary fuel???


Since the enviromental crowd decided it was a huge contributor to global warming/global chaos/global we're all gonna die-ism/non-natural warming, natural cooling/whatever its called this week, etc, etc. Additives that are incredibly expensive will make things all green again

[tanaww]

And then you will do to him what you and your evil co-conspirator Seeker did to my darling Daughter! The Queen is more corrupt and evil than EVER after her weekend in Canadia!

[Strongman]

I know in my industry (automotive heavy duty wheels end products), we raised prices 27% from April 1st to the 15th. We had a 7% increase on the 1st, the the next week, the foundry put a 20% surcharge for the metal. So it sucks all the way around.

[Crispin's Crispian]

Since the enviromental crowd decided it was a huge contributor to global warming/global chaos/global we're all gonna die-ism/non-natural warming, natural cooling/whatever its called this week, etc, etc. Additives that are incredibly expensive will make things all green again

I thought diesel was getting more expensive because of something to do with trying to equalize the amount spent at the pump for the same mileage. That is, diesel gets better mpg than gasoline, so people buy it less often. To make the same profit, the price thus needs to be higher.

Clearly it's not additives that are the main problem--the price of crude oil is skyrocketing too.

[Sinistrum]

Yeah I've got gas problems too...but mostly just after Bryan eats Mexican. :p

[Zaela Sedai]

Its 4.13 here now for reg and over 5.00 for deisel, I don't know how the truckers do it.


Didn't stop the boaters on Memorial Day weekend though.

[Sei'taer]

I thought diesel was getting more expensive because of something to do with trying to equalize the amount spent at the pump for the same mileage. That is, diesel gets better mpg than gasoline, so people buy it less often. To make the same profit, the price thus needs to be higher.

Clearly it's not additives that are the main problem--the price of crude oil is skyrocketing too.


OK, I asked some of the construction companies why diesel was so much higher now. Here was the answer...kind of all put together.

1. Farm fuel (colored red) is the same fuel, but you get a tax cut for it. It is used mainly in agriculture and construction equipment and is only allowed for those vehicles. If the DOT catches you using it in a car or truck then the fines are big, big. It is colored so that it leaves behind a red residue that can be detected with the right equipment and the DOT has the right equipment.

2. Regular, or white diesel is what you buy at the pump. I was sort of wrong about the additives, there are some additives put in to help with emissions, but what happened is the US changed its enviromental standards and moved to an ultra-low sulfur diesel. The move to lower sulfur content is supposed to lower emissions of particulate matter from diesel engines. The problem is that it is taxed at a higher rate than gas, or red diesel, it is more expensive to refine, and fewer people drive diesels in the US so it is a supply and demand issue also, less demand= less supply=higher price.

These are supposed to be the problems, I may get my search engine powered up later and take a look around to see if thats the case for sure.

You are dead on with the main problem being the price of crude.

[Ishara]

Ha! If by evil you mean stylishly attired and cool, then I can live with that. :p

Right now we're at $1.30/litre. This blows. They'd better not give me surcharge on my luggage tomorrow or I'll freak out. Then pay it. Dammit.